Home Contractor vs. Homeowner

Contractors run into problems when they advance money for custom materials or do a great deal of work on a project without receiving payment from the homeowner. The best way for a contractor to avoid getting "burned" is to start with a good contract. If the homeowner breaches the contract and refuses to allow the contractor back to complete the work, the contractor is entitled to the value of the work done to date. He or she may also be able to claim lost profits if it is found the the homeowner has unlawfully terminated the contract. Unless the contractor has provisions in his contract entitling him to attorney's fees, interest and/or costs, the contractor will not be able to collect for those items. Contractors may incur other damages that are caused by the homeowner. If the homeowner delays in making decisions, or acquiring materials, he or she can cost the contractor money as a result of the delays. In addition, homeowners may bring other independent contractors onto ...

What are the damages that can be recovered by a homeowner when a home contractor fails to complete the job, or does the work improperly? The damages depend on the claims that are brought against the contractor. Typical damages include: Breach of contract - The homeowner has a duty to mitigate (reduce) his damages in a reasonable fashion, but may sue for the amount of money that it takes to complete the work, minus any money that was held back from the contract. The homeowner may also collect for moneys paid to do corrective work beyond the contract price. Under some state statutes, the homeowner may collect up to double or triple damages, attorney's fees and costs (filing fees, etc.). The doubling or tripling of damages is usually awarded when there have been unfair and/or deceptive practices, or extreme negligence by the contractor. These damages are "punitive" in nature, in that the double or triple damages are the punishment. Consequential damages, lost time from work ...

It may sound bizarre to say that I try not to litigate cases, but for most clients, going through litigation is incredibly stressful and expensive. Even if they have the right to recover their attorney's fees if they win their suit, these are not guaranteed, and recovery may be difficult. Settling disputes is usually preferable for a number of reasons: 1. Parties are more likely to comply with agreements that they create, as opposed to a decision handed down by a judge (studies have shown this). 2. Litigation can take years, and money now is frequently better than money later. 3. Even if one obtains a judgment, it may not be collectible. 4. Dragging out a dispute through litigation means it stays a part of your life for a very long time. 5. I have lost cases I should have won, and vice-versa. 6. Litigating a case can be like playing the lottery. That said, one should not start a case without being prepared to see it through. Clients need to know that there is frequently a flurry...

The Difficult Contractor Please excuse the delay in posting. The last few weeks have been quite busy. In a recent post I discussed how to deal with difficult homeowners. Now it is time to focus on the difficult contractor. What kinds of actions do contractors take that make life difficult for the homeowner? The first action is actually the opposite. The most common problem for homeowners is the contractor’s failure to show up at the work site on a regular basis. Jobs that are scheduled to be completed within a certain amount of time end up getting dragged out, and the homeowners despair as their home remains a construction site. The contractor has not abandoned the job, so the homeowner cannot claim that the contract has been terminated, but the work is taking forever. What can a homeowner do? First, this problem must be addressed in the contract itself. There should be a provision that states that the contractor will be on site for a number of days or hours per week. If the ...

As many of you may realize, I live in Massachusetts, where we have been facing the reality of The Big Dig for a very long time. For those of you who are not familiar with The Big Dig, it was the world's most expensive construction project (it may still be), and the plan was to submerge a raised highway that divided Boston, put in tunnels and connectors, etc. Given that Boston is one of the oldest cities in the United States, the traffic has greatly outgrown the layout of the city, and the bottlenecks through downtown can be quite bad. So, for Bostonians, The Big Dig seemed like a great idea. The problem is, the cost has greatly exceeded the budget (See this 2003 article for some figures: http://www.csmonitor.com/2003/1219/p02s01-ussc.html ) and now we have been faced with serious safety issues as well. After the fatal accident in which a woman was killed when a concrete ceiling tile fell, residents have been affected by the closing of the connector tunnel to the airport. We have be...

Someone recently googled the keywords listed in the title, alerting me to the fact that when one has lost the leverage of the final payment, the homeowner is frequently at wit's end. Many homeowners end up kicking themselves when a contractor abandons a job, or ignores the final punchlist once payment has been made. What is a homeowner to do? First of all, understand that you are not alone. Many bright, intelligent people make the final payment for a variety of reasons. Two, make a game plan. If there is work that still needs to be done, or punchlist items that have been ignored, send the contractor a demand letter outlining the work and proposing a schedule for completion. Tell him or her that s/he has x days to respond with a reasonable proposal (offer of settlement), or you will take further action. In Massachusetts, under the Consumer Protection Act, one is required to write a 30-day demand letter in order to pursue a claim that may ultimately pay double or treble damages, atto...